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HP Becoming Potential Takeover Target
Acquisition haunts at Hewlett-Packard Co.as the major computer manufacturing company’s new strategic move has resulted in the company being valued lowest among all technology companies in the world.
HP’s market capitalization slipped to an estimated $10 billion when the company made public its strategy of spinning off its PC unit, and completely revert back on a five month old strategy to run its mobile software OS on it PC devices. The company instead has chosen to boost its software services thorough the acquisition of Autonomy Corp. Data analyzed at Bloomberg estimated that a 20 percent fall in its market value resulted in nearly 70 percent reduced profits for Hewlett-Packard, headquartered Palo Alto, California in comparison with the typical technology firms.
As Leo Apotheker made his entry as the CEO of HP last November, Shareholders have faced a five time fall as equated with competitors and reduced revenues valued to be lowest in ten years. Solaris Gourp LCC said the situation is making tempted buyers to break it up and buy the remains. It would be Oracle Corp. (NASDAQ:ORCL) gain from the server unit, making it largest maker of the hardware through its increase in stocks to fivefold. HP’s printer business is its most profitable business, with 70 percent. This printer business is very attractive to the private equity companies.
In a telephonic interview, Michael Mullaney of Fiduciary Trust, Boston, responsible for managing $9.5 billion of shares which includes HP’s Stock too says, “HP’s price at the time appears enormously striking and it would be that some exact match may acquire the company or to the smallest buy the fragments.”
Mullaney in a comment said HP’s present situation seems to be like an uncontrollable ship. Spokesperson of HP, Bill Wohl denied takeover threats saying they are just rumors or gossip.
Nine years past merger their with Compaq Computer Corp., HP has now decided to separate the PC business which had made it the largest player in the PC business. HP was aiming to install the WebOS software that it had gained through the acquisition of Palm Inc. last year, on all its computing devices, tablets and smartphones.
The acquisition of Autonomy Corp will building competition with Oracle and International Business Machines Corp. . Apotheker, CEO of HP who previously was head SAP AG is looking to increase cloud computing and increase revenues through high yielding products as buyers demand diminishes for its tablets and smartphones, with Apple Inc. dominating the tablet market with the iPad.
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